Current Research Projects

Regional Integration in Latin America and Sub-Saharan Africa

Since the early 1990s, the number of regional trade agreements has increased significantly in both developed and developing countries. By creating a larger market for trade and investments, these regional relations may accelerate economic growth and improve welfare levels. The research project aims at identifying the drivers of regional integration with a focus on MERCOSUR and the COMESA-EAC-SADC-Tripartite. Furthermore, it empirically examines the effects on bilateral trade as well as on economic growth within these regional trade agreements.

The Aid-for-Trade Initiative of the WTO

Today, it is widely acknowledged that developing countries need support to benefit from trade liberalization. Accordingly, policymakers at the WTO's Ministerial Conference in Hong Kong in 2005 moved Aid for Trade into the focus of international trade policy. The research project aims at identifying the principal factors that make trade an effective tool of economic and social development.

Institution Building and Good Governance in Developing Countries

It is widely accepted that high-quality institutions and good governance are important for economic and social development. Many studies have shown that institutional quality and good governance are major prerequisites for higher growth rates in the mid- to long-term. The research project aims to analyze the drivers of changes in these two areas, that is, the political and economic factors that enhance the quality of institutions and ensure that good governance prevails.

Determinants of Foreign Direct Investment

Foreign Direct Investment (FDI) inflows are widely perceived to be superior to other types of capital inflows. Apart from offering additional investment resources, FDI may help host countries foster economic development by offering more (and, sometimes, better paid) jobs as well as access to internationally available technologies and managerial know-how. These factors in turn render it easier for the host countries to penetrate foreign markets and make them less prone to sudden reversal of flows in times of crisis. The research project examines the determinants of FDI, partly by using country case studies and partly by employing an extensive data set of bilateral FDI flows for a large number of reporter and host countries. The main focus is on those areas that are within the sphere of influence of policy makers in developed and developing countries, such as bilateral investment treaties, double taxation treaties or exchange rate regimes.

South-South Cooperation

The increasing role of large developing countries in global trade, finance, investment and governance, coupled with their rapid economic growth, has rekindled interest in South-South cooperation – a concept that encompasses technical and economic cooperation among developing countries to promote common development goals. How will South-South Cooperation influence the geography of global growth and what does this imply for development and development policy? This research project examines the determinants and the impact of South-South Cooperation in various countries, e.g., Chinese FDI in Sub-Saharan Africa. Of particular interest are patterns of trade, FDI, aid and institutions in these countries and how South-South Cooperation diverges in comparison to the development cooperation approach of industrialized countries.